Tuesday, November 11, 2008

Time To Go

It's time for the Fed to go. Why? Just ask Bloomberg because Bloomberg is demanding, via a lawsuit, that Bernankie (Fed Head) and Paulson (Secretary of the Treasury) tell us where two trillion dollars of our money has gone. For a detailed view of Bloomberg's Freedom of Information lawsuit, click here.

"The Federal Reserve is refusing to identify the recipients of almost $2 trillion of emergency loans from American taxpayers or the troubled assets the central bank is accepting as collateral.

Fed Chairman Ben S. Bernanke and Treasury Secretary Henry Paulson said in September they would comply with congressional demands for transparency in a $700 billion bailout of the banking system. Two months later, as the Fed lends far more than that in separate rescue programs that didn't require approval by Congress, Americans have no idea where their money is going or what securities the banks are pledging in return."

The ironic part about this is even though this is our money, we have to pay the Fed interest to "borrow" it to fund the bailout to unknown parties because the government doesn't have the right to print it's own money, the Fed does.

It becomes stranger still that the Fed is a private entity run by bankers for bankers, something that should become rather evident to the most obtuse observer based on the current actions of Paulson and Bernanke, two officials who have sworn oaths to serve the public good.

To add insult to injury, consider this..."WASHINGTON — Nineteen banks taking taxpayer money from the Treasury Department have spent $32.4 million lobbying the federal government during the first nine months of this year, their lobbying disclosure reports show.

Combined, the Treasury is investing in the banks $159 billion from the $700 billion financial rescue package approved by Congress last month. None of the banks has indicated it plans to stop lobbying.

NO CHANGE: Despite crisis, Merrill Lynch still lobbying

And this, "When the restructured deal is complete, taxpayers will have invested and lent a total of $150 billion to A.I.G., the most the government has ever directed to a single private enterprise. It is a stark reversal of the government’s assurance that its earlier moves had stabilized A.I.G

PS, AIG's worth about 7 billion

Addendum: Here's an update on Bloomberg vs the Fed:

"Bloomberg requested details of Fed lending under the Freedom of Information Act and filed a federal lawsuit against the central bank Nov. 7 seeking to force disclosure of borrower banks and their collateral. Arguments in the suit may be heard as soon as this month, according to the court docket. Bloomberg asked the Treasury in an FOIA request Jan. 28 for a detailed list of the securities it planned to guarantee for Citigroup and Bank of America. Bloomberg hasn’t received a response to the request.

The Bloomberg lawsuit is Bloomberg LP v. Board of Governors of the Federal Reserve System, 08-CV-9595, U.S. District Court, Southern District of New York (Manhattan)."

The Perfect Storm looms.

Quick Update, click here to get Bloomberg's latest salvo.

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